OCC Announces Creation of Special Purpose FinTech Charter

In an expected, but still exciting, announcement on December 2, Comptroller Curry stated that the OCC will develop a special purpose FinTech charter.

In conjunction with the announcement, the OCC released Exploring Special Purpose National Bank Charters for FinTech Companies, its white paper on the subject. Both the white paper and Comptroller Curry discussed the need for industry and legal comment on the charter and its attendant guidelines and regulations. The OCC currently grants special purpose charters to credit card banks and trust banks, among others, and has determined it has the power to charter FinTech companies within its current legal authority. Any company that limits its activities to fiduciary activities and/or conducts at least one of the three core banking functions (receiving deposits, paying checks, or lending money) would be eligible for the special purpose charter.

There are several legal and regulatory requirements that are generally thought to be synonymous with an OCC-chartered bank, including adherence to the Community Reinvestment Act, Bank Secrecy Act and anti-money laundering reporting obligations, and capital and liquidity requirements. Depending on the type of banking activity and the business model, a chartered FinTech company might or might not have similar obligations. The applicability of these (or similar) laws and regulations is a major issue on which the OCC is requesting public comment. This outreach is in addition to the recently approved Offices of Innovation, currently headed by Beth Knickerbocker, which will host office hours for FinTech companies and interested parties to discuss the current issues in FinTech and the expectations for “responsible innovation.”